Claims of R4m attempted extortion in deal gone bad
● Claims of harassment and attempted extortion of R4m have emerged in a Cape Town court case involving well-known auctioneer John Cowing and controversial politically connected businessman Joseph Nkadimeng.
The two are at loggerheads over a failed business deal to dispose of aviation assets worth more than R1bn.
Cowing, who owns the South African franchise of the international asset disposal and auction company Liquidity Services, approached the Wynberg magistrate’s court in May seeking a protection order against Nkadimeng for allegedly harassing and trying to extort R4m from him.
But Nkadimeng has countered Cowing’s claims with allegations Cowing shortchanged him in the disposal of Swissport’s assets. The Switzerland-based aviation company lost out on the Airports Company South Africa (Acsa) contract to handle OR Tambo International Airport ground and cargo services.
Nkadimeng says he had an agreement with Cowing through their respective companies, Otita Advisory Services and Liquidity Services, that he would get a 20% share of deals bringing in clients. Nkadimeng claims that since 2021 he has brought in clients such as the Industrial Development Corporation (IDC), the South African National Defence Force (SANDF) and Swissport.
In an affidavit in the Wynberg case, Cowing, the former chair of the South African Institute of Auctioneers, says he and Nkadimeng had an agreement Liquidity would pay Otita a monthly R25,000 retainer, provide R15,000 a month for Nkadimeng’s Killarney flat, and give him a car with a petrol card with a R10,000 monthly limit. He said Otita rendered services between May 2023 and March 2024, and that the parties also agreed Liquidity would pay Otita compensation of 20% on a deal-by-deal basis.
“During the period referred to, Otita and [Nkadimeng] failed to secure any business opportunities that have materialised for Liquidity. [In other words], no fees were generated from any opportunity that Otita & Liquidity worked [on] together,” says Cowing. He says a fallout ensued in January, which resulted in Nkadimeng sending him a “plethora of abusive and threatening WhatsApp messages and voice notes”.
“The messages went further than mere harassment. [Nkadimeng] not only seeks to extort money from me under the threat of criminal charges and [the] publication of defamatory material, but has also threatened my life. I have suffered harm as a result of these threats, which includes mental, psychological and economic hardship,” Cowing says in his affidavit.
But Nkadimeng, named as a notable figure in setting up a “war room” to win the ANC votes in the 2016 municipal elections, this week refuted Cowing’s allegations, saying that, according to his estimations, he is entitled to about R200m from the disposal of Swissport’s assets, which Liquidity leased to Menzies Aviation, the company that won the Acsa contract at OR Tambo airport, before disposing of them. The assets included aviation ground-support cargo tractors, belt loaders, tow tractors, and refuelling trucks.
“We worked together just fine with John, and I even brought some deals, such as the disposal of assets from the IDC and the SANDF. But he then turned against me when it came to the Swissport deal, which I helped to secure. I did not threaten him — I just told him the truth, and I was OK to settle for R4m and walk away,” said Nkadimeng.
Nkadimeng, after receiving a separation notice from Cowing, sent a letter to the auctioneer through his attorney, Thabo Kwinana, on April 17 demanding R4m as part of the settlement. “Your company will make all the necessary arrangements and payments to ensure that Mr Joseph Nkadimeng and his dependants can continue to reside in the current apartment provided to him by your company till May 31 2024, at which time he will vacate same.
“Our client will renounce all claims, benefits and other entitlements whatsoever from all current and prospective opportunities or contracts that your company has or may secure from the IDC, Swissport and the [Asset Forfeiture Unit] that our clients were or have been in pursuit of with and for your company,” said Kwinana in a letter to Cowing.
However, the next day Cowing, through his attorney Sean Pienaar, told Nkadimeng they would not accede to his demands.
“Please advise on what possible legal basis your client is entitled to claim R4m from our client. The lease at the premises has been terminated. Your client and his wife must vacate the premises as demanded ... Our client has been extremely reasonable and generous in its settlement proposal to your client. Our client, in our view, has no legal obligation to pay any funds to your client and will implore you to be reasonable to ensure both parties can separate amicably and move on with their lives,” said Pienaar.
In the court application for a protection order against Nkadimeng, Cowing attached WhatsApp messages sent by Nkadimeng to him in March, in which the latter uses strong language. “You are defrauding [the South African Revenue Service]. Companies and directors go to jail about lying to the state about [their] BEE status,” reads the message. Cowing said he responded by telling Nkadimeng he was seeking legal advice about his “erratic messaging”.
“I understand your current financial position, so will make payments I have paid monthly for some time in good faith. Thereafter, you will receive formal communication from my lawyer. At this stage, we have not signed contracts with any clients. However, I will recognise your efforts in a list of deals where I have met representatives from those entities and been able to formally offer our services,” said Cowing in his response.
But Nkadimeng did not stop sending messages and threatened to expose Cowing for alleged BEE fronting, saying he would open a criminal case unless he was paid at least R250,000 instead of R4m.
Nkadimeng showed the Sunday Times a response by Liquidity to a Passenger Rail Agency of South Africa “request for quotation” for the supply and delivery of asset tags, in which the company said it had been given a BEE score of 30 for the extent of black women’s ownership of the company.
However, the National Treasury’s central supplier database (CSD) report shows Liquidity is 100% owned by Cowing. But Cowing has denied this information is accurate and up to date. He told the Sunday Times the fallout with Nkadimeng started when his company terminated Nkadimeng’s services because of poor performance.
“Mr Nkadimeng introduced Liquidity Services to senior staff members of Swissport, but no business was secured as a result of such introduction, and therefore Mr Nkadimeng was not entitled to any commission,” said Cowing.
He denied the fronting allegations, saying 16% of his company’s shares had been sold to a black woman.
“Liquidity has been lawfully allocated points and benefits in accordance with several provisions of [BEE] legislation, and also owing to the number of years a previous black shareholder [owned a stake in] Liquidity Services, prior to selling her shares.
“Liquidity has since sold shares to Zulfaa Arend as our new black shareholder. The CSD report has been updated to show the 16% shareholding owned by Zulfaa Arend. It [was 100% owned by me] during the time [after] the previous shareholder sold her shares and [before] Zulfaa bought her shares,” said Cowing.
The messages went further than mere harassment. [Nkadimeng] not only seeks to extort money from me under the threat of criminal charges and publication of defamatory material, but has also threatened my life
John Cowing, auctioneer